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Indonesia benefits from China’s economic growth, transition
JAKARTA (Xinhua) – Indonesia will benefit from China’s economic growth and transition amid massive global uncertainties, Indonesian experts told Xinhua.
Indonesian economist Yudhoyono Firmanzah, a special adviser for economic affairs to Indonesia’s former President Susilo Bambang, said that China’s economy, which grew 6.7 per cent last year, was the biggest contributor to world growth.
Yudhoyono, who is also the rector of Indonesia’s Paramadina University, said that China’s economic growth was very sound last year given its large scale.
China’s economic reform and growth are high on the agenda of the ongoing “two sessions” that started on March 3 and March 5 respectively.
Commenting on China’s “two sessions,” namely, the fifth session of the 12th National People’s Congress (NPC) and the fifth session of the 12th National Committee of the Chinese People’s Political Consultative Conference, he said that the meetings would pump new momentum into the economy.
The meetings are expected to outline the trajectory of the economic development this year, boost the coherence between legislative and executive bodies and enhance consensuses among all circles, the economist said.
Noting that China is Indonesia’s biggest trade partner, biggest tourism market and second largest source of foreign direct investment (FDI), Yudhoyono said China has now become Indonesia’s most important economic partner.
The two economies are highly correlated as each 1 per cent of rise in China’s gross domestic product (GDP) would contribute to 0.3 per cent of Indonesia’s economic growth, he said.
High-rise buildings behind residential houses in Central Jakarta. – AFP
Currently when the global economy is facing enormous uncertainties with a slow recovery, Indonesian experts agree that the largest economy in the Association of Southeast Asian Nations (Asean) should seize opportunities presented by China’s development and seek growth by cooperating with China.
Bambang Suryono, an Indonesian scholar and president of the Jakarta-based think tank Nanyang Asean Foundation, told Xinhua that populism, protectionism and de-globalisation are regaining popularity globally.
Brexit, expectation of a hike of the US benchmark rate, the unpredictable policies of the new US administration led by President Donald Trump as well as other uncertainties would “definitely undermine the global economic growth potential,” he said.
China’s economy would continue to be the growth engine and stabiliser of the world economy, Bambang said, suggesting Indonesian and Chinese policymakers coordinate and communicate more to promote regional growth.
Christine Susanna Tjhin, senior researcher at Indonesia’s prominent think tank Center for Strategic and International Studies and an expert on China, said Indonesia can benefit from China’s economic transition from export-led growth to a model increasingly driven by consumption.
As a consumption-led economy, China’s transition would create a huge market for Indonesia as it would import more, Christine said.
Given the complementarity between the two economies, more investment from China is expected, especially in infrastructure and manufacturing sectors, she said.
Indonesia’s Joko Widodo administration has put forward the “Global Maritime Fulcrum” strategy and pledged to develop the maritime related economy.
Dino Patti Djalal, Indonesia’s former vice foreign minister, told Xinhua that the concept is much similar to China’s “21st Century Maritime Silk Road” initiative, which is part of the Belt and Road Initiative.
“The two countries should enlarge the cooperation fields from maritime infrastructure only,” the former Indonesian ambassador to the United States said, adding that the two governments and private sectors should study these concepts and embark on more cooperation.
Source: http://borneobulletin.com.bn/indonesia-benefits-chinas-economic-growth-transition/